reject 3. The role of epigenetic factors in regulation of coding and non-coding HOX genes. Epigenetic regulation of gene expression during development relies on the products of two large gene amilies, the trithorax-group (trxG) of activators and the Polycomb-group (PcG) of repressers. The emerging picture of their functioning suggests that these proteins exert their activities by altering the chromatin structure of their target genes. Importantly, irrespective of the ways in which trxG and PcG proteins exert their activities, they are capable of locking in a specific status of gene expression, which s then inherited in an epigenetic fashion in daughter cells. The studies of these two groups of proteins have an important health-related application since some of these proteins, as for example ALL-1/MLL, are believed to be involved in a number of cancers. Our data suggest that the trxG protein complex TAC1, containing a Drosophila homologue of ALL-1, is an essential component of the network of factors that facilitate elongation by RNA polymerase II (Pol II). Recruitment of TAC1 to the elonagting 3ol II depends on a number of elongation factors, and is accompanied by modifications of histones in the coding region of its target homeotic gene Ultrabithorax (Ubx). We also discovered that TAG1 is essential for transcriptional elongation of a number of non-coding intergenic transcripts (ncRNAs) in the Ubx locus. Expression of these ncRNAs precedes expression of Ubx and represses Ubx expression in certain cells of the developing embryo. Repression by ncRNAs may occur by the novel for higher eukaryotes transcription interference mechanism, although other transcription-based repression mechanisms cannot be also excluded. To extend these studies for other regions of the BX- C and to obtain further insight into functioning of TAC1 in conjunction with other trxG and PcG proteins we will: (i) Investigate the mechanisms of Ubx repression by the upstream ncRNAs; (ii) Extend these studies to other ncRNAs and other HOX genes in the BX-C; (iii) Investigatethe roles of TAC1 and other trxG proteins at Ubx promoter and bxd ncRNAs; (iv) Investigate functioning of trxG and PcG complexes at their common epigenetic elements. Answers to these questions will shed new light not only on the way TAC1 exerts its effects during transcriptional regulation, but will also reveal the roles of other trxG and PcG proteins in epigenetic maintenance during cell cycle. The exciting new possibility is that part of the TAC1 effect on HOX gene regulation may occur through its regulation of ncRNAs that in their turn are essential for creating mosaic patterns of HQX gene expression. RELEVANCE (See instructions): Given structural and functional similarities between TRX and ALL-1, and the fact that human HOX clusters also contain ncRNAs, these studies will greatly advance our knowledge of the basic mechanisms of transcriptional regulation in higher eukaryotes and their relevance to diseases like cancer.